Sainsbury's Bank being taken over by NatWest; reasons for possible action required by account holders.
Sainsbury's Bank announces transfer of savings and borrowing products to NatWest, effective from May 1, 2025. The move encompasses savings accounts, loans, and credit cards, following NatWest's acquisition of Sainsbury's Bank's retail banking assets and liabilities.
The acquisition came about in June 2024, with NatWest taking over the credit card, unsecured personal loans, and savings account businesses of Sainsbury's Bank. This decision was precipitated by Sainsbury's Bank's announcement in January that it was exiting these markets entirely. However, the insurance and travel money services will continue to be operative under Sainsbury's Bank, unaffected by the transfer.
Customers with substantial savings in both banks are advised to consider moving their funds to ensure continuity of protection, given that the Financial Services Compensation Scheme (FSCS) protects savings up to £85,000 per person, per institution. Post-transfer, customers will have only one institution to rely on for FSCS protection.
Interest rates on savings accounts may not change upon the transfer, but could alter due to other factors such as movements in the Bank of England base interest rate. Proposed changes to accounts will be communicated at least 60 days in advance, allowing customers the opportunity to compare their rate with other providers to secure better deals if available.
Under the deal, Sainsbury's Bank will remain as the primary point of contact for customer queries, complaints, disputes, or claims. Customers are advised to keep their funds below the FSCS protection limit or spread them across multiple banking groups if they hold more than £85,000 in combined Savings accounts with both Sainsbury's Bank and NatWest.
Access to savings accounts, the Sainsbury's Bank app, direct debits, standing orders, and spending and payments patterns will not be affected immediately. Customers will be contacted by NatWest in the following months to transition their accounts to NatWest's systems.
For Sainsbury's loan customers, the loan repayment amount, date, and rate will remain the same, as well as any repayment arrangements in case of arrears. Customers should continue making payments as agreed, with any potential changes to support arrangements to be communicated by NatWest in due course.
In light of the transfer of Sainsbury's Bank's savings, loans, and credit card products to NatWest, individuals may need to reevaluate their personal-finance strategies, considering moving their savings to ensure continuity of protection, given the Financial Services Compensation Scheme (FSCS) limit of £85,000 per person, per institution. Businesses seeking competitive finance options should keep an eye on potential changes in interest rates following the transfer, as these could influence their savings accounts and investment decisions.
